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IT Declaration

Contents

Income Tax Declaration

An income tax is a tax imposed on individuals or entities (taxpayers) that varies with respective income or profits (taxable income). Income tax generally is computed as the product of a tax rate times taxable income. Taxation rates may vary by type or characteristics of the taxpayer. Income tax is a privilege set by the Organizations to pay as tax for the development and accreditation. To help individuals and companies to regulate the payment of tax, Organizations adapt ERP tools to ease this process at the back end. We need to enter the details for processing and follow the steps to have it filled. By doing this, the Organization just needs to pay at the front end and close for the financial year. As soon as the employee logs in the portal, the name and employee code automatically shows, and the current financial year, In this guide, we will be discussing the following heads that appear in the screen, Steps: Logging in with the employee credentials, the ESS will automatically generate the data required, for any changes, updates or any clarifications. In this ESS screen, the employee calculates the IT based on the given period and plan
  • Period - Current financial period that the IT has to be filed against his salary
  • Plan - In the screen, we can see the employee has opted for Plan: 1, it is a sample given for understanding the concept, for example, the employee has planned to pay the TDS (Tax Deducted at Source) - so he wants to include any three main sources to pay his IT, {House rent allowances+Housing loan+Other asset income} the employee needs to combine the three and can submit as TDS that can be paid, which reflects in Income tax filing.
Type - Income tax setting for the period - 2019 - 2020. This period as we discussed already is automated pre-determined by the Organizations, which commends each year for filing the IT, so when prompted to pay the TDS with IT the type is default given, and this is subject to change by the Organization approval. Status - As we can see the types of status given for preparation of the IT, these types here describes that the employee has
  1. Drafted the TDS,
  2. Submitted for approval
  3. Approved by the accounts department
  4. Locked - if the pin or id is entered wrongly the login gets locked, but the details will be safe, without any changes.
  5. Amended -  when there is correction the tax return, in case of any mistakes
Zero Suppress & Display level Zero Supress - means, if there are multiple entry in the tax return form, and in that only few description has values to be shown for references, and other description doesn’t have values to be shown and it default displays, by clicking the Zero Supress the display will show only the returns which have numeric values and hide the dummies that does not have values. Display Level - This is a unique feature, that is programmed to display only the needed tax returns. For example,  there are 10 entries usually displayed, but in this file, we need only the first 5, at this time, when the selected number is typed to display and the print is given then it will display only the 5 tax returns. TDS Calculator - When the specifications above are selected to calculate the TDS for tax filing, the TDS calculates the returns for submitting to the IT returns for deductions. The categories that an employee can pursue in the Plans which they can opt are mentioned below
  1. Housing Loan (self-occupied)
  2. Leave Travel
  3. House Rent Paid
  4. Rental Income
  5. 6A Part 1 (Incomes)
  6. 6A Part 2 (Expenses)
  7. Other Income
  8. Other Tax Paid
Print - After completion of the whole process, to have the proof of data for submission. This is how the form looks like. Now let us discuss how each TDS as categorized for submission for the financial year. Housing loan - Housing loan (self-occupied) is for the personal purpose the employee has taken a loan for constructing a house, for that the employee if opts to add it under the PLAN 1, the below are things to be filled in    Lender - being the mandatory particular that has to be entered. To select the lender click on the select lender button It displays the list of lenders, who have provided for the above particular or for the whole project, When we need to add a new Lender, click on the add symbol button Lender details will be displayed on the screen, where a new lender can be added. After entering the necessary information, subject to prior approval, and clicking on the Update button in the corner end of the screen, then the details get an update, which can be used for the future and for database purposes. Leave Travel - When an employee goes for an official trip or for onsite programs, the company or the employee spends for the traveling. The traveling details are mandatory proof that has to be filled and if there are any attachments like travelling tickets, room cost, food bills can be entered or attached in this screen. House Rent - The employee can also submit the house rent receipt for deductions in the IT returns, The screen explains the details like, from which period the employee is residing in the house, whether it is a Metro or Non-Metro cities because the due diligence of the IT filing changes according to it. Landlord - if the employee has shifted the house in between the financial year, then the employee has to enter both the landlord's name. To add the landlord to the return details, press the + and add the current landlord, and update the details. Rental Income - The form below, has a detailed explanation of how the form has to be filled, the employee who earns also from the rental business, can enter the details summed in the form below.
  1. To briefly explain, the employee total annual income from the rentals (yearly)
  2. Local tax paid - tax paid for the property, includes the rental tax, electricity, water, and tax benefits to it.
  3. Adding up the both above is the Net Annual Value
  4. From the Net Annual Value - standard deduction is deducted.
  5. Interest on Capital borrowed - capital amount or loan amount interest that has to be deducted.
  6. Including both above, we derive the Total deductions
  7. From the Net Annual Value + Total Deductions - the principle Net income will be calculated which gives the factual figures for the IT filing on Rental Income.
  8. As proof, the tenant details can be entered or added.
Completing the necessary details above, it will be submitted for the housing rent deduction.
  • 6A Part 1(Investment) - The investment part explains that the employee has given an acknowledgment to deduct as part of saving. The employee can decide, under what it can be saved, for example, Employee provident fund, Investment in the public provident fund(IPPF), Equity Linked Saving Scheme (ELSS), etc., these can be claimed for saving or investment with IT under sections 80C, 80CCC and 80CCD.
After the selection of the section, the employee can declare the specified amount needed to provide for the investment part. A sample has been given for a clear understanding. In this section column, we can select under what section the investment has to be levied upon, and the rest follows. 6A Part 2 (expenses) - In accordance with 6A part1 Investment, the same concept is for expenses too. The sections that are needed for expenses that can be claimed against that the employee has spent. 80D, 80E, 80EE, 80DD, 80G, 80 TTA, etc., using these sections against the expenses the employee can levy and claim the expenses incurred. The employee has to do the same process for the expenses claims process as same as the Investment process. The Other Income and Other Tax paid, also describes the same procedure that is practiced for the above-explained buttons. Practice this IT Declaration screen once or twice for easy access to the form. After completing the procedure the department or account sections undergo a checking process to proceed further. Therefore kindly follow the steps adhered. From the pick list in the section field given in each of the above screen is as follows:
Tab Name SECTION Particulars
(6A Part 1) Investments
 80c Investment in PPF
80c Employee’s share of PF contribution
80c NSCs
80c Life Insurance Premium payment
80c Children’s Tuition Fee
80c Principal Repayment of home loan
80c Investment in Sukanya Samridhi Account
80c ULIPS
80c ELSS
80c Sum paid to purchase deferred annuity
80c Five year deposit scheme
80c Senior Citizens savings scheme
80c Subscription to notified securities/notified deposits scheme
80c Contribution to notified Pension Fund set up by Mutual Fund or UTI.
80c Subscription to Home Loan Account Scheme of the National Housing Bank
80c Subscription to deposit scheme of a public sector or company engaged in providing housing finance
80c Contribution to notified annuity Plan of LIC
80c Subscription to equity shares/ debentures of an approved eligible issue
80c Subscription to notified bonds of NABARD
80CCD (1B) Sec 80CCD NPS (Max Rs 50,000/-)
80CCD (2) Sec 80CCD(2) NPS (Employer Contribution)
(6a Part 2) Expenses
 6A2 80D : Medical Health Insurance (self)
6A2 80D : Medical Health Insurance (Parents)
6A2 80E : Interest on Education Loan
6A2 80EE : First time home buyers.
6A2 80DD: Maintenance including medical treatment of a dependent with disability.
6A2 80DDB: Medical treatment on specified disease
6A2 80U : In case of a person with disability
6A2 80GG: Where House rent is paid and HRA not received
6A2 80GGA: Donations for Scientific Research or Rural Development
6A2 80GGC: Contributions to Political Parties
6A2 80TTA : Iinterest on deposits in Savings Account
6A2 80TTB : Interest from deposits held by Senior Citizens
6A2 80G : Donations
6A2 80EE1 : Interest on Home Loan for Affordable Home
6A2 80EEB : Interest on Auto Loan for Electric Vehicle
6A2 Other Deductions, if any
Other Income
 INC Mutual Fund Dividend
INC Savings Interest
INC Other Income
Other Tax
 TAX Capital Gains Tax (from Stocks & MFs)
TAX Capital Gains Tax (from Property)
TAX Tax on Dividend
TAX Other Tax
The above mandatory calculations are made easy with the help of the accounts executive.

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